O2 mobile customer data to be sold to third parties

Smart Steps product first on the block - targeted at retailers and public sector

Telefónica, the owner of the O2 brand in the UK, is to start selling its mobile customer data to third parties in what could prove a controversial move.

The Telefónica Digital business has launched the Telefónica Dynamic Insights global business unit, "dedicated to identifying and unlocking the potential opportunities for creating value from Big data", said Telefónica.

It said Telefónica Dynamic Insights will "provide companies and public sector organisations around the world with analytical insights that enable them to become more effective".

It will develop a range of products and services using different data sets, including machine to machine data and anonymised and aggregated mobile network data from its customers.

In testing of new products a number of large companies, including financial services firms, use real customer data in benchmark tests, but in the past that data has been mistakenly leaked or lost. This has led to calls for the ending of using real customer data for testing.

With Telefónica taking it one step further and now selling that data, privacy campaigners will be up in arms. One only has to look at the critcism companies like Google and Yahoo receive for using anonymised customer data in their web targeted advertising business.

Telefónica said the first product to launch will be "Smart Steps", which will use fully anonymised and aggregated mobile network data to "enable companies and public sector organisations to measure, compare and understand what factors influence the number of people visiting a location at any time".

It said this insight will help retailers tailor local offerings for existing stores and determine the best locations and most appropriate formats for new stores.

It added that a number of retailers are already helping with product development by providing user feedback. Telefónica claimed Smart Steps would also enable town councils measure how many more people visit their high street after the introduction of free car parking or late night shopping, for instance.

"Big data is one of the key building blocks of the digital economy. Approached in a smart and responsible way it has the potential to transform every part of business and society," said Stephen Shurrock, chief commercial officer at Telefónica Digital.

Earlier this week a Cambridge professor said the use of medical records - even anonymised - for statistical and research purposes posed a threat to privacy.

University of Cambridge professor of security engineering Ross Anderson warned that a "huge loophole" is being carved in the European Union's upcoming data protection regulation.